TVA instituting new shoreline fees next year

CHATTANOOGA — The Tennessee Valley Authority is preparing to roll out restructured fees for shoreline marinas across the seven-state region that some smaller operators say could be the death knell of their businesses.

The fees to be applied in 2013 will affect about 450 riverbank businesses on 46 reservoirs owned by the TVA, which is a federal government utility. The fees will use a formula that assesses market-value rental or lease value or a percent of commercial revenue, said James Adams, TVA’s manager for land and shorelines. The overall new contract is based on 4 percent of revenue.

Larry Steidle owns Blue Springs Marina, between Kingston and Spring City on the Tennessee River. He told the Chattanooga Times Free Press he owns land, but TVA owns the water and the shoreline up to a certain point.

Steidle, who has been in business for three decades, worries about the new fees.

“Now with this recent land and shoreline policy change, they want a percentage of your gross income or your base fee,” Steidle said. “I doubt if my bills can withstand that.”

However, TVA land and shoreline communications consultant Bill Sitton said the fees are called for.

“These folks are in private business making money off of public land,” said Sitton.

Marina and campground operators are joined by at least two county chiefs in asking TVA to reconsider. Rhea County Mayor George Thacker and Meigs County Executive Garland Lankford went before the TVA board last week.

Thacker told the board the fee is akin to a new tax, which the utility said is not the case. Board members thanked the county officials, but didn’t act on their request for a moratorium.

Not all operators see the fees as onerous. Bob McMahan, vice president of chief operating officer of Erwin Marine, says they are fair. The company operates Chickamauga Marina.

“If people are complaining, they’re taking exception to what it used to be. If they’re saying this will put them out of business, then they’ve got bigger problems,” said McMahan.

McMahan said TVA’s planned increases in 2005 were too high, but five years of negotiations produced a workable increase.

“Really some of those old licenses (lease rates) were really low — I mean three figures a year,” he said.

TVA now makes between $500,000 and $600,000 from its commercial shoreline leases.

It’s too early to figure what the revenue will look like until all the recreational contracts have been signed for next year, Adams said.